Power Biz 101

Environmental Compliance Costs Are Significant.
All electric companies are subject to hundreds of environmental rules, including dozens of federal and state air and water quality requirements created with the Clean Air Act and Clean Water Act. In fact, electric companies spend billions of dollars each year to help ensure protection of the air, land, and water. From 2002 to 2005, the electric power industry as a whole spent at least $21 billion on compliance with federal environmental laws; state and local rules drive that total even higher.

As a result, air quality in the United States has improved dramatically in recent years. In fact, since 1980, electric companies have reduced emissions of nitrogen oxides and sulfur dioxide by 44 percent and 40 percent, respectively, while electricity demand grew by 77 percent.

The costs associated with continuous environmental improvements are significant. For example, according to the U.S. Environmental Protection Agency, complying with two new federal rules aimed at further reducing power plant emissions of nitrogen oxides, sulfur dioxide, and mercury will cost the electric utility industry $47.8 billion between the years 2007 to 2025.[14] As electric companies enter another phase of emissions reductions, those costs will be reflected in customers’ bills.

[14]U.S. Environmental Protection Agency, Office of Air and Radiation, October 2005.